Heineken Beer Still Optimistic on the Chinese Market Despite Decline

For Jacco van der Linden, 45, managing director of Heineken China since 2015, the decline in the country’s beer market over the past three years represents an opportunity. In terms of volumes, 500 million hectoliters of beer were sold in China in 2014. That figure dropped to around 460 million hectoliters in 2016, according to consultancy Euromonitor International…Full Article: China Daily Aug 2017

Key Points

As of 2017, China accounted for 25% of the global beer market’s volume, but only 10% of the market’s global revenue and 3% of its global profit.

In 1983, Heineken entered mainland China. The Dutch brewery gained a foothold in the cities of Putian, Quanzhou and Fuzhou, Fujian Province.

ChinaAg Comments

In March 2016, China Resources announced it would buyout SABMiller’s 49% share in their joint venture, China Resources Snow Breweries, for USD 1.6 billion. The buyout was relatively cheap, with many analysts forecasting a USD 3 billion to USD 5 billion price tag.

In December 2015, China Resources began financial inquiries into purchasing SABMiller’s 49% stake in order to allow Anheuser-Busch InBev to secure anti-trust approval in China for the latter’s takeover of SAB Miller.

In October 2015, Anheuser-Busch InBev NV agreed to purchase SABMiller for US$104.2 billion.

As of early 2015, five breweries had an 80% share of the beer market in China. These include Huarun Snow Beer Co Ltd, Tsingtao Brewery Co Ltd, Anheuser-Busch InBev, Beijing Yanjing Brewery, and the Carlsberg Group.

In August 2014, Euromonitor International stated that Snow beer (operated by China Resources Enterprises) had a 21.7% market share in China, followed Tsingtao Brewery Co with 15.7%, Beijing Yanjing Brewery with 11.7%, Anheuser-Busch InBev at 11.4%, Henan Jinxing Brewery with 3.4%, and Carlsberg with 2.6%.